Tesla Under Investigation for ‘Misleading’ Self-Driving Claims

Prosecutors with the Department of Justice are investigating whether electric vehicle maker Tesla committed either wire or securities fraud by misleading consumers and investors about the self-driving capabilities of its EVs.

Reuters cited three people who are familiar with the situation in issuing its report this week.

The Autopilot and Full Self-Driving systems that Tesla vehicles have assist drivers with braking, lane changes and steering. However, they aren’t fully autonomous vehicles.

Tesla has warned its drivers that they need to remain ready to manually take over driving, the DOJ is looking into certain statements that CEO Elon Musk and other officials at the company have made, and whether they misled people into believing the EVs could actually drive themselves.

The automaker also had to issue a mass recall over hundreds of crashes that happened while drivers had the Autopilot feature engaged. Some of those crashes were fatal, and regulators in the U.S. are already looking into them as part of separate investigations.

According to the Reuters report, the investigators are trying to see whether they believe Tesla committed wire fraud by misleading consumers about the driver-assistance systems its vehicles have, the sources told the media outlet.

Wire fraud involves deception in communications over state lines.

In addition, the company is under investigation for possible securities fraud, which would involve deceiving investors, related to the same issue.

One of the sources who spoke to Reuters said that the U.S. Securities and Exchange Commission was looking into how Tesla was representing its driver-assistance systems to potential and current investors.

Neither the SEC nor officials from Tesla responded to a comment request that Reuters sent to them. Officials from the DOJ declined to comment on the situation.

In October 2023, Tesla disclosed in a filing that the DOJ requested from them information about its Autopilot and Full Self-Driving system.

Reuters was the first media outlet to report on this situation, and it was also the first outlet to report on a criminal investigation into Tesla back in October 2022.

The probe was first launched by the DOJ in 2021 after there were more than 12 crashes involving the Autopilot system in Teslas, sources told Reuters at the time.

The media outlet reported then that from as far back as 2016, marketing materials at Tesla started to tout the Autopilot capabilities of its EVs. That year, Musk described the system on a conference call as “probably better” than human drivers.

On a separate call in October 2022, Musk announced that Tesla was about to release an upgraded version of the software for its Full Self-Driving system that would allow people to travel “to your work, your friend’s house, to the grocery store without you touching the wheel.”

Videos that were posted on Tesla’s website also said:

“The person in the driver’s seat is only there for legal reasons. He is not doing anything. The car is driving itself.”

It’s statements like those that have Tesla facing some serious investigations from various federal agencies.